Manufacturing

German union will get half its four-day-week wish

26 Aug 2020

IG Metall wants to save jobs by cutting workers’ hours, but without proportional pay cuts. Shorter workweeks make sense for employers, staff and the economy. The per-hour wage hike only suits employees. Dire growth prospects give bosses the upper hand in negotiations.

Knorr-Bremse makes case for driverless company

13 Aug 2020

The German brakes maker has lost its second CEO in less than two years. The shadow of billionaire majority shareholder Heinz Hermann Thiele looms too large. But Knorr-Bremse’s market dominance and lack of major rivals mean there’s little urgent need to find a replacement.

Corona Capital: Amazon, Car perks, College sports

29 Jun 2020

Concise views on the pandemic’s corporate and financial fallout: Companies are trying to bolster pocketbooks. Amazon makes extra payments to employees while car companies are offering major discounts. Plus: Under Armour ditches its UCLA deal.

Winnebago’s spring surge may run out of gas

24 Jun 2020

The recreational-vehicle maker’s stock price has more than tripled from March lows as social distancing pushes stir-crazy Americans outdoors. But the company’s valuation is stuffed with expectations of hitting Mount Rainier-type heights. Investors might want to put on the brakes.

Financial myopia could be healed by virus

21 May 2020

Apple, Airbus and Asahi are among many companies withdrawing forecasts during the pandemic. It’s a good time to reconsider campaigns by JPMorgan boss Jamie Dimon and others to end quarterly profit guidance. Covid-19 should help refocus attention on the longer-term.

Ford, GM can ride out lockdown till September

27 Mar 2020

The two U.S. automakers are bringing in almost no revenue with factories and sales on hiatus. And they have huge fixed costs. But they’re awash with cash and don’t need to buy parts. Throw in some austerity, and each has around six months before no or slow sales threaten a crash.

Rolls-Royce takeoff requires disbelief suspension

28 Feb 2020

The engineer made a $1 bln operating loss after issues in its aerospace arm. Shares rose after CEO Warren East said charges related to the Trent 1000 engine were now mostly over. To hit a $1.3 bln free cash flow target, investors used to bruising one-offs must take his word.

Thyssenkrupp’s big lift deal puts time over price

17 Feb 2020

The German group has narrowed the field of bidders for its elevator division to two private equity consortia. Trade buyer Kone’s 17 bln euro premium offer is out. Thyssenkrupp insists an IPO remains an option, but its need for a clean, quick deal implies otherwise.

Home cleanup lets Philips focus on health push

28 Jan 2020

The 40 bln euro Dutch group is offloading its vacuum and coffee maker arm which brings in 12% of revenue. Detangling the business is fiddly but lets CEO Frans van Houten focus on its health units. Catching up with rivals like Siemens Healthineers requires more reliable results.

Trump’s trade war chases its own tail

16 Jan 2020

The U.S. president is hailing his agreement with China as a boost to farmers and manufacturing workers. It is, but only because they were the losers from trade conflict. Obama showed that following the rules doesn’t work; Trump has only shown that ripping them up doesn’t either.

Siemens will sand down its valuation discount

7 Nov 2019

The German industrial group had a good fourth quarter. Shares are valued at 15 times forward earnings, compared with 19 times for peer ABB. If Chief Executive Joe Kaeser can achieve his relatively modest 2020 earnings ambitions, he can close that gap with his European rival.

Investors are too lighthearted about sober October

3 Oct 2019

The U.S. services sector is weakening while manufacturing is contracting, just as a new front opens in President Donald Trump’s trade war and his potential impeachment heats up. Some of this can be soothed by the Fed, but not all – and fiscal backup may prove hard to come by.

Japan-Korea spat returns chip price error message

25 Jul 2019

Earnings at semiconductor giant SK Hynix plunged 88%, weighed down by a worldwide glut. Yet shares rose on hopes that Tokyo's export curbs to South Korea will depress supply and lift prices. The risks of weaker demand and supply chain ruptures suggest the rally looks premature.

Foxconn leaves room for governance improvement

11 Jun 2019

Taiwan's $32 bln iPhone assembler has missed an opportunity with its first investor day. A management rejig is encouraging, but stops short of a succession plan. Worse, it fails to clarify departing boss Terry Gou’s future role. Shareholders will be left only a little wiser.

BMW-Daimler: a more logical German M&A champion

20 Mar 2019

Berlin wants a merger of Deutsche Bank and Commerzbank to protect two flagship companies. Its second- and third-biggest carmakers would be a better pair, and might actually strengthen each other. The risk is that shareholders and policymakers only realise when it’s too late.

The Exchange: Hollowing out white-collar jobs

13 Feb 2019

In “The Globotics Upheaval” Richard Baldwin predicts machine learning and instant communications will disrupt service workers just as automation and offshoring upended Western factories. He tells Breakingviews what’s coming, and what we can do to slow it down.

Foxconn’s U.S. debacle offers an economics lesson

31 Jan 2019

The iPhone maker and Wisconsin taxpayers made a $10 bln bet on a manufacturing revival in the United States. Now Terry Gou's outfit says making flat screens there is uncompetitive, and jobs will be in research and design. It's a reality check for Donald Trump's industrial dream.

Mary Barra belatedly supercharges GM’s strategy

26 Nov 2018

Her decision to scrap low-selling brands and thin the $53 bln carmaker’s bloated executive ranks was overdue. But cutting $6 bln of costs gives GM more fuel to weather trade wars and slowing sales – and to inject into the electric-vehicle and self-driving race Barra hopes to win.

Musk takes a couple of toes off the pedal

10 Sep 2018

The $45 bln electric-car maker's CEO has promoted an insider to run the autos unit, among other changes, after "in-depth" talks with directors. An experienced outsider would have been better. Musk remains free to overpromise and underdeliver.

Russia will keep on mixing toys and politics

21 Aug 2018

Strong first-half sales at children’s store Detsky Mir will help Sistema, which needs to sell its stake after a costly $1.5 billion settlement with Rosneft. A less politically risky owner might help the rapidly growing toy group’s low valuation. Yet that’s in no way guaranteed.